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Mixed picture of national giving

August 26th, 2021

The latest Australian Tax Office data on national giving reveals a mixed picture of increased overall donations from the nation’s taxpayers but a 40-year low in the percentage of those taxpayers claiming a donation.

The annual analysis of the ATO data, carried out by the Australian Centre for Philanthropy and Nonprofit Studies at QUT, shows that overall donations claimed as tax-deductible gifts for 2018-19 were $3.93 billion, well up on the $3.75 billion from the previous year. The average tax-deductible donation made to DGRs and claimed by Australian taxpayers went up by 10.34 percent, from $845.73 in the previous financial year, to $933.20, in 2018-19.

This data, which is the latest iteration of the nation’s longest available statistics on our giving, establishes a benchmark for next year’s figures that will reflect the impact of the bushfires and the first wave of the COVID-19 pandemic.

In 2018-19, there were 4.21 million taxpayers who made and claimed tax-deductible donations. However, this represented a decrease in the percentage of the population making donations and claims, down from 31.01 percent in the previous year to 28.69 percent.

It is the first time since 1978-79 that this figure has dropped below 30 percent. And yet it comes a time when the percentage of what those individual taxpayers who donate and claim from their taxable income remains at its highest recorded level – approximately 0.43 percent, the same as it was in 2017-18.

A potential explanation for why overall donations were up but the percentage of individuals who gave was down, is a combination of fewer taxpayers claiming a deduction and an increase in the overall number of taxpayers.

At the top end of the income scale – those earning $1 million or more a year – there was almost 55 percent who made tax-deductible donations. Their average donation was $138,611.55, a significant 48 percent increase of the previous year’s average.

But there was 45 percent of those people in that income band who did not make a claim in 2017-18, a percentage of high-net worth individuals that has shown little change for a number of years.

The data also reveals a growth of 10.59 percent in the number of people who are employed by organisations with a workplace giving program. And while there has been a similar increase in the number of employees giving to such programs, the overall percentage of employees using workplace giving has remained around the same level, at 4.76 percent (up 0.28 percent). In total, workplace giving contributed $43 million in 2018-19, up 13.16 percent on the previous year, with an average donation of $215.

When it came to job roles, chief executive and managing directors once again recorded the highest average amount donated, although the amount fell by 13.76% on 2017-18 figures.

And Western Australia was the most generous state, with the highest total and average donations claimed in 2018-19, but the report explains that “…this was primarily due to the influence of taxpayers in one postal code (WA 6011, Cottesloe, Peppermint Grove).’’

Western Australia also has the postcode with the nation’s highest percentage of taxpayers claiming a donation. “This does not appear to be obviously related to the wealth of taxpayers. For the third year in a row, the postcode with the highest percentage rate was Joondalup DC …(65.36 percent), which is a regional [West Australian] metropolitan city, with an average income of $62,985.19,’’ the report notes.

An Examination of Tax-Deductible Donations Made By Individual Australian Taxpayers in 2018-19: ACPNS Working Paper No. 74

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